SIXTH FLOOR. 900 HOWE STREET. BOX 250 TELEPHONE: (604) 660-4700 VANCOUVER. B.C. V6Z 2N3 BC TOLL FREE: 1-800-663-1385 CANADA FACSIMILE: (604) 660-1102 AN ORDER IN THE MATTER OF the Utilities Commission Act, S.B.C. 1980, c. 60, as amended and An Application by Pacific Northern Gas Ltd. for Pricing Arrangements for the 1994/95 Gas Contract Year BEFORE: M.K. Jaccard, Chairperson; and ) L.R. Barr, Deputy Chairperson ) October 21, 1994 ORDER WHEREAS: A. On October 18, 1994 Pacific Northern Gas Ltd. ("PNG") applied to the Commission for approval of Gas Supply Pricing Arrangements for the 1994/95 gas contract year with Talisman Energy Inc. ("Talisman") and Ocelot Energy Inc. ("Ocelot") and for approval of a price hedging strategy with respect to these contracts; and B. On October 21, 1994 PNG provided the Commission with a letter from Westcoast Gas Services Inc. ("WGSI") that provided the rationale underpinning the agreements reached with Ocelot and Talisman and the hedging strategy; and C. The Commission has reviewed the filings and is satisfied that the gas supply pricing arrangements should be approved. NOW THEREFORE pursuant to Section 85.3 of the Utilities Commission Act and the Rules, the Commission approves the following gas supply arrangements for PNG: 1. The pricing arrangement for the 1994/95 gas contract year that is based on the NYMEX Index for the Talisman contract dated October 24, 1991. 2. The pricing arrangement for 1994/95 gas contract year that is based on the Inside FERC Sumas Index for the Ocelot contract dated October 25, 1991. 3. The Commission approves in principle PNG's strategy to hedge the price of the greater part of gas purchases from Talisman and Ocelot during November 1994 through March 1995, at current index levels. 4. PNG is to file, in a timely manner, the executed contract amendments and a statement of the hedging positions that it establishes. DA TED at the City of Vancouver, in the Province of British Columbia, this day of October, 1994. BY ORDER /\ IJ~_~ Dr. Mark K. laccard Chairperson BCUCIOrdcrs/PNG-OcclotยทTalismanContrcts
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